Anxieties about the unsustainable runup in Chinese corporate debt sparked a massive rally in bitcoin that sent the price of a single virtual coin to its highest level in more than two years.

The price of a single bitcoin broke above $700 on Monday for the first time since early February 2014, just before the failure of a prominent bitcoin exchange ignited a years-long selloff.

Beginning around 5 p.m. Eastern on Saturday, bitcoin prices shot higher, rising from around $580 to more than $700 in trading midday U.S. time Monday.

Chinese buyers were behind the bulk of the rally, trading volumes show, with nearly 85% of transactions conducted in yuan, according to data from CryptoCompare.

One bitcoin recently traded hands at 4,756 yuan, according to CryptoCompare, a 1% premium to the price measured in dollars, at $714.

CryptoCompare

A chart showing bitcoin prices over the past three years.

People who monitor trading in the cryptocurrency market said this most recent rally was sparked by comments from the International Monetary Fund’s No. 2 official about the systemic threat posed by China’s massive pile of corporate debt.

The IMF is set to conclude its yearly assessment of the country’s economy on Tuesday. Their analysis is expected to focus on the country’s debt issue.

China’s total debt of around 225% of gross domestic product isn’t particularly high by global standards, but its corporate debt pile, equivalent to 145% of GDP, is high, according to the International Monetary Fund.

Anxieties about China’s massive pile of risky corporate debt have escalated over the past year as Chinese officials slashed capital reserve ratios for the country’s banks. Doing so theoretically makes it easier for banks to lend and, thereby, boost declining economic growth rates.

Charles Hayter, the chief executive of CryptoCompare, said some Chinese investors, anxious to protect their assets as the threat of an economic disaster, have sought succor in bitcoin.

“Bitcoin fits the bill perfectly as a conduit to evade capital controls, and as a hedge against depreciation,” said Charles Hayter, the founder of CryptoCompare.

Bitcoin prices have been rising steadily since late last year. Over the past month, bitcoin prices have risen 51.5% in dollar terms, and 58% when measured in yuan, according to data provided by Cryptocompare.

Bitcoin prices haven’t been this strong since early February 2014, before Mt. Gox, one of the first and formerly one of the largest bitcoin exchanges, abruptly halted bitcoin withdrawals, blaming a bug in the bitcoin software that allowed for the manipulation of transaction data.

The firm eventually admitted it had been hacked, and that millions of customer bitcoins had been stolen. It quickly filed for bankruptcy, and investors’ claims to recover some of their lost coins are still working their way through Japanese bankruptcy courts.

The selloff that followed undid most of a speculative runup in bitcoin that occurred during October and November of 2013. Prices eventually peaked at an all-time high of $1,242 a coin in late November of that year.

In January 2015, nearly a year after the Mt. Gox troubles began, prices bottomed out at below $200 a coin, the weakest level since before the latest price runup began in late 2013.

Investors bid up bitcoin ahead of ‘the halving’

Investors are also bidding up the currency in anticipation of a phenomenon that will cut the digital currency’s rate of inflation in half, according to several market experts.

The event, which cryptocurrency enthusiasts call “the halving,” should happen in about 26 days, judging by the current rate at which bitcoin blocks are mined.

Currently, bitcoin miners — users who are rewarded with newly minted bitcoins for donating computer power to the network — receive 25 new bitcoins every time they successfully mine a new block. After the halving, that number will drop to 12.5.

The mechanism behind the halving was written into the bitcoin protocol to manage the supply of bitcoin over the long term.

“This halving is basically the monetary policy of bitcoin,” said Erik Voorhees, chief executive of ShapeShift. “Everyone whose using this money knows what the money supply will be in four years or fifty years.”

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